St George trials Apple iBeacon in branches

news Westpac subsidiary St George Bank has revealed plans to deploy a trial of Apple’s iBeacon technology in three Sydney branches, in a move which will see customers’ iPhones sent a welcome message and “tailored information” when they enter a branch.

iBeacon is Apple’s name for a type of electronic signal transmitters that can sit at a certain location and notify nearby Apple devices of their presence, when the Apple devices are running version 7 and above of its iOS mobile operating system. To receive the messages, customers must have Bluetooth switched on on their device.

St George Bank said in a statement issued this week that it had kicked off the start of iBeacon trials within its retail branch network, marking an “Australian-first” for a bank to adopt the new technology, which aims to enhance customer experience and interaction.

Currently being trialled in three Sydney branches, the technology delivers a personalised experience each time a St.George customer enters a branch by sending a welcome message and tailored information directly to their iPhone from an iPad in the branch. Customers can respond to the message or cancel the interaction. The purpose of the trial is to gain valuable feedback from customers to ensure the service genuinely meets their needs and enhances their experience with St.George.

George Frazis, CEO of St.George Banking Group said the launch of the new technology formed part of an increased focus on delivering an innovative and customer-centric in-branch experience.

“The future of business will be in the ability to anticipate customer’s needs, understand what matters to them and act on that knowledge to surprise and delight them. Our investment in iBeacon will help us to achieve that – and it has the potential to dramatically change the service experience in Australian banking,” he said.

“The iBeacon trial forms part of a broader investment in our retail branches that will see more digital technology and increased staff expertise to make banking simpler, easier and faster for our customers.

St.George chief information officer Dhiren Kulkarni commented: “St.George is a pioneer in banking technology in Australia, being the first bank in Australia to launch internet banking in 1995 and mobile banking in 2009. The launch of iBeacon is the next step in that innovation evolution. Our trial with iBeacon is the first step in the process to explore how closely we can integrate the technology into our branches to deliver a new level of customer service. Once we have completed the trial, we will review the results and plan how we can roll-out nationally.

The news comes as Australia’s major banks are all currently experimenting with many different methods of communicating with customers and unlocking greater functionality, including apps on smartphones, tablets, smartwatches and even Google’s Glass augmented reality and heads-up display glasses.

opinion/analysis
I view the iBeacon technology as more or less a gimmick at this point, and I don’t think it’s going to do much for St George or anyone else — similarly to the way I don’t think Google Glass or smartwatch apps are going to have much impact for the bank.

This is the tricky thing for Australian banks at the moment. The area where they really need to innovate, as the Commonwealth Bank has shown, is in the fundamental underlying layers of their service delivery platforms — in their core banking systems (to enable real-time banking and quick product and account provisioning) as well as in Internet banking and mobile transactions.

This is where real substantial improvements to customer services can be made. The caveat, of course, is that it takes hundreds of millions of dollars to more than a billion to go down this path — and that is money that the banks really don’t like spending. Right now, it’s really only CommBank which has committed to this level of change, although NAB is gradually moving down that path as well. And so it’s really only CommBank which has reaped these rewards. Most of the other banks, as St George shows with this iBeacon trial, are messing around with less impactful technologies.

I recently switched all of my business and personal banking away from St George (about 12 accounts) to CommBank, after about a decade with the happy dragon. I did so because St George’s Internet banking platform has seen very little investment since it was bought by Westpac, and was consistently unavailable in some periods late at night (especially Sunday night), due to batch processing requirements.

CommBank doesn’t have that same problem, and all of its mobile, Internet banking and even cards infrastructure is top-notch, brand new and feature-packed. Right now, when it comes to customers like me, who have to use their Internet banking daily, the dollarmite is kicking the dragon’s ass.

Implementing iBeacons in a branch would not have convinced me to stay with St George. A wholesale revamp of its core IT infrastructure, with the flow-on effects to its edge customer apps that would likely be generated, would have. And I suspect I am not alone in feeling this way.

You may or may not like Apple but they generally are very concerned over user experience and privacy.

An iBeacon can’t spam a user. The user needs to install an app that responds to a specific beacon ID and even if the app is installed they can deny that app access to location information through the privacy settings in iOS or deny the app the permission to display notifications on the screen.

an iBeacon cannot broadcast a message to a device that is not listening for it or to a device where the user has not permitted the app to display messages

Nevertheless, that is how it works. The idea is that it gives much more specific location details than are available from gps – especially indoors. Beacons can have very low power and may only be visible within a meter or two.

The beacon advertises 3 numbers. The first number is uniqueidentifier for the organisation. Their app listens for this and gets notified (if the user allows) when in range. This means the app only has to register for notification of one identifier, not hundreds or thousands of geographical locations. This is much more efficient in terms of memory, processor and battery life.

The meaning of the other 2 numbers is up to the organisation to define, but presumably St George will use one to indicate the branch. They could then use another to indicate whether you were at the ATM or at the teller or just waiting in the branch if they wanted.

The biggest problem with iBeacon is that it requires Bluetooth to be switched on as it uses BTLE. Smartphone users have been conditioned to keep it OFF unless they are using it to conserve battery life.

No bluetooth, no iBeacon, so until Apple have separate controls for BTLE it will continue to be useless tech.

“I view the iBeacon technology as more or less a gimmick at this point,”

Initially I thought the same thing but then I started thinking of potential useful uses for it such as:

Asking you what service you are visiting the bank for and giving you a queue number with wasting loads of thermal paper. And then when a Teller or CSO is ready to see you, alerting you via your phone. If the iBeacon tech has the ability to advise your bank of your iBanking registered phone number (most bank apps use this already) then it could also speed up the “who are you” and “what can I help you with” processes as you would be potentially be able to pre-supply a lot more info than is possible with a public queueing terminal.

imo this type of thing would be well recieved however if they just use it for spam then that would not be well recieved.

This functionality IMO would certainly be great if integrated into the iBank app and activated by the iBeacon then it would certainly allow for a more featured and personalized experience.

If the customer doesn’t have the iBank app then they could be directed to a secure web portal – the iBeacon could potentially give your phone instructions to connect to a secure in-bank wifi network designed for this exact purpose.

This is of course all pure postulation on my part, who knows whether an inherently conservative banking organization would implement this sort of thing.

You are right it could be done now but IMO iBeacon would make it easier by acting as a trigger to the ibank app (which to date haven’t run any background processes – do you really want your bank etc app monitoring your gps location and draining your battery?) buy opening the app and providing the secure wifi connection credentials transparently to the user.

The alternative process is clumsy and customers simply wouldn’t bother, as it would involve multiple steps:

Open phone
Find app.
Open app. (Assumes app is able to connect you to secure wifi)
Log in
Select services etc
Wait for alert telling you which CSO can see you now

With iBeacon it could look like this:

Tap lock screen notification (phone opens app. Connects to secure wifi)
Select services
Login to app only if additional service detail is required
Wait for alert telling you which CSO can see you now

There’s not a huge difference between the various methods, however I think the subtle niceties iBeacon based services could potentially provide would just make it a far better customer experience and being with it higher customer acceptance.

One thing I would note tho. IBeacon should really be submitted as an IEEE standard so it’s not limited to iOS devices.

Apple makes the spec available under free license and lots of people have reverse engineered it anyway (it is hard to keep a broadcasting bluetooth advertisement secret :) ) so you can get both Apple certified and non-certified iBeacon hardware. Interestingly, Apple themselves do not make any iBeacon hardware.

The article refers to something St George and the whole iBeacon thing don’t seem to get, though – innovative uses of tech are mostly freeing users from restrictive forms of bank and money management. With Internet banking and mobile apps users can access their accounts and transfer funds in seconds from anywhere. With NFC they can make instant payments and even ATM withdrawals – in the future it may even enable customers to receive funds from each other instantly, essentially eliminating the need for cash. Who at this point even goes into their local bank branch? All this tech is designed to free you from that anachronistic necessity. iBeacons appear to cater to a type of banking that most people don’t even want to be doing at this point.

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